Allied World is expected to retain an indirect minority interest in Vault, support the transition under and provide reinsurance support


Cornell Capital, HSCM to acquire Vault. (Credit: Gerd Altmann from Pixabay.)

Cornell Capital, a private investment firm and Hudson Structured Capital Management (HSCM), an asset manager and re-insurer, have teamed up to acquire a majority stake in Vault Holdings from Allied World Assurance Company.

Allied World is expected to retain an indirect minority interest in Vault and support an easy transition under an administrative services agreement and provide reinsurance support.

As part of the transaction, Vault co-founder, and former chairman and CEO of Allied World Assurance Company, Scott Carmilani would continue serving as chairman of Vault’s Board.

Under the leadership of co-founder Carmilani and CEO Charles Williamson, Vault is expected to continue its business operations.

The acquisition is planned to be closed in the first quarter of 2021, subject to regulatory approvals and other customary closing conditions.

Carmilani said: “The market demand for premium personal insurance is growing rapidly. There are more than 12 million U.S. households in our target market, up from 6.8 million in 2009, and nearly 80% of them do not currently utilise the services of a high-net-worth insurance specialist, presenting Vault with a large addressable market.”

Williamson said: “I’m extremely confident in Vault’s future and the balance-sheet flexibility this transaction provides. By leveraging Cornell Capital and HSCM’s deep industry expertise, operational capabilities, and capital resources, Vault is poised to unlock additional growth opportunities.”

Established in October 2017, Vault offers customised insurance services and policies for high-value homes and cars, along with collections of art, jewellery, wine, antiques, and memorabilia, through its network of appointed agents and brokers.

Operating under a unique hybrid business model, the company serves as a reciprocal insurance exchange, managing general agent, and excess-surplus insurance provider.

Also, the company is said to combine the advanced technology platform and personalised service to address the needs of its clients.

For the transaction, TigerRisk Capital Markets & Advisory is serving as financial advisor to Cornell Capital, HSCM and Vault in connection, while Debevoise & Plimpton as legal advisor to Cornell Capital and HSCM.

Cornell Capital founder and senior partner Henry Cornell said: “In less than three years, Vault has progressed from a dynamic startup to a fast-growing disruptor.

“Our team brings significant experience partnering with and growing leading insurance companies, and we look forward to working closely with Scott, Charles, and the Vault team to execute on our shared vision for continued growth.

“Moving forward, Vault has the potential to become an even stronger, more nimble competitor, capable of reshaping the sector, attracting and retaining top talent, and achieving market leadership in high-net-worth personal insurance.”